Case Studies 2

On November 12^th 2010 we received a call from a nonprofit credit union located in Philadelphia. The Client told us they had been Censured by the State of Pennsylvania and had been issued a “Cease & Desist” order effective December 31,2010. They asked if we would be able to reconcile all the banks records and bank statements by December 15, 2010.

They had not had a professional accountant on staff for 5 years and all of the financial transactions were being maintained by various volunteers. There were cash accounts and asset accounts that had not been reviewed for years.

As a result of the State’s initial findings, the National Credit Union Association (NCUA) was called in. They are similar to the FDIC or SEC as they are a government agency that oversees all Credit Unions in the United States. 

Our Team poured through records, transactions and bank statements through the Thanksgiving Holiday. We began a relationship with the NCUA and shared information. We found a few glaring errors that were related to inexperienced people processing transactions. We kept a level of transparency with both the NCUA and the client and got a 15-day extension until December 31, 2010 to present our findings.

We worked continuously, poured through the old records, researched every piece of data analyzed the processes being used and were able to report that the $528,000 difference the State uncovered never left the Credit Union it was all sitting in asset accounts instead of cash accounts. 

We presented all of our findings to the Client and the NCUA. The Chairperson at the NCUA told me this was the first time in NCUA’s history that they have ever been able to return a Credit Union to the original owners with a clean bill of health. This was a big win for our client. 

We also presented recommendations on how the client could prevent something like this from happening again. The NCUA, State of Pennsylvania added our recommendations to the return documents. The “Cease & Desist” order and the censure we removed and the bank could operate as normal.